So if I want to buy an mp3 from an artist, and the artist charges me 0.99$ for it, paypal will take ~0.40$ of it. Paypal becomes the artist's 60-40% partner. So this option is clearly not viable. If you go through bitcoin, the artist can keep like 98-95% of the money.
As Leo says, we need to go deeper.
https://www.paypal.com/webapps/mpp/merchant-feesWhat Paypal calls "micropayments" are 5%+5c per transaction. For $1, that's 10c, getting dangerously close to the 4c you're always talking about.
Personally, I would put the upper end of micro-transactions at 10c tops and probably down to 5c and maybe lower. What you would like to see as fees for a transaction come out as a ridiculous portion of the cost.